Six years of litigation, one law. Law No. 177/2026 closes, at least in part, one of the most contentious tax issues of recent years: the wave of tax assessment decisions through which the National Agency for Fiscal Administration (“ANAF”) has retroactively claimed VAT, sometimes for periods going back five to six years, from taxpayers whose VAT registration had been cancelled by the tax authority.
Published in the Official Gazette, Part I, No. 700 of 24 August 2026, the law entered into force three days later, on 27 August 2026.
The mechanism that the law seeks to remedy is familiar to any practitioner who has assisted a taxpayer in this situation. In practical terms, a taxpayer is removed from the register of VAT payers under Article 316(11) of the Fiscal Code:
- either on the ground that it has been declared fiscally inactive (letter a);
- or on the ground that it has failed to file VAT returns for six consecutive months or two consecutive quarters (letter d);
- or on the ground that it has filed VAT returns reporting no transactions, for the same period (letter e).
The taxpayer continues to operate, sometimes unaware that it no longer holds a valid VAT code, and at other times because it resumes activity without applying for re-registration. ANAF does not intervene immediately, but only later, through a tax audit or a documentary verification. In this context, the tax authority recalculates VAT for the entire period during which the code was cancelled, denying the right to deduct input VAT on purchases while claiming the full amount of output VAT on supplies, generally together with interest and penalties calculated over the entire period.
Law No. 177/2026 does not challenge the legality of the cancellation of the VAT code as such; rather, it addresses the tax consequence of that cancellation where such consequence has been exploited retroactively, through a tax assessment decision.
What Does Law No. 177/2026 Actually Cancel?
The scope of the law covers the additional principal tax liabilities representing VAT, together with the related late-payment interest and penalties, established by the tax authority through a tax assessment decision issued and communicated for tax periods between 1 January 2019 and the date the law entered into force (27 August 2026), against taxpayers whose VAT registration was cancelled under Article 316(11)(a), (d) or (e) of the Fiscal Code.
The sole article of the law provides, in paragraph (1): “The additional principal tax liabilities representing value added tax and/or the related ancillary tax obligations, established by the tax authority through a tax assessment decision issued and communicated to the taxpayer pursuant to Article 11(6) or (8), as applicable, as a result of the cancellation of VAT registration under Article 316(11)(a), (d) and (e) of Law No. 227/2015 on the Fiscal Code, as subsequently amended and supplemented, for tax periods between 1 January 2019 and the date this law enters into force, shall be cancelled.”
The reference to Article 11(6) and (8) of the Fiscal Code is not incidental. These are the provisions that, for the period during which registration was cancelled, require the taxpayer to charge VAT on the supplies of goods and services made, while simultaneously denying it the right to deduct VAT on purchases. In practical terms, paragraph (1) of the law targets precisely the tax claim resulting from the application of this mechanism.
The law also covers cases in which the cancellation of the code occurred under the former Fiscal Code, prior to 2016. In this respect, paragraph (2) states: “The provisions of paragraph (1) shall apply accordingly where the cancellation of VAT registration was carried out pursuant to Article 153(9)(a), (b), (d) and (e) of Law No. 571/2003 on the Fiscal Code, as in force on the date the VAT registration was cancelled.”
A similar regime, resting on a distinct legal basis, applies to agricultural cooperatives established under Law No. 566/2004, for VAT relating to the purchase of agricultural equipment made between 9 January 2024 and the date the law entered into force, pursuant to paragraph (3): “The additional value added tax, together with the related ancillary tax obligations, established by the tax authority through a tax assessment decision issued and communicated to agricultural cooperatives set up under the Agricultural Cooperation Law No. 566/2004, as subsequently amended and supplemented, representing value added tax on purchases of agricultural equipment in respect of which such cooperatives exercised the right of deduction, for tax periods between 9 January 2024 and the date this law enters into force, shall be cancelled.”
We further note that the law is not limited to cancelling tax claims already established; it also prohibits, for the same periods, the issuance of new tax assessment decisions of this kind, as reflected in the following provisions:
- paragraph (8): “The tax authority shall not issue a tax assessment decision for tax and ancillary obligations of the kind referred to in paragraphs (1) and (2), for tax periods between 1 January 2019 and the date this law enters into force”;
- paragraph (9): “The tax authority shall not issue a tax assessment decision for tax and ancillary obligations of the kind referred to in paragraph (3), for tax periods between 9 January 2024 and the date this law enters into force.”
In conclusion, tax inspectors no longer have the right to issue tax assessment decisions based on the cancellation of the VAT code for the 2019–2026 period, regardless of whether that period has already been audited.
The law expressly excludes from cancellation the tax liabilities arising where the taxpayer separately stated VAT on invoices or actually collected the tax from the beneficiary, as established by the tax authority; in this regard, paragraph (7) expressly provides: “This law shall not apply to tax obligations relating to transactions for which the taxpayer separately stated value added tax on invoices or equivalent documents, or collected, in whole or in part, value added tax from beneficiaries, as established by the tax authority.”
In our view, this is the only relevant and justified exception. Law No. 177/2026 writes off a claim that the state should not, in principle, have retroactively asserted against a taxpayer acting in good faith, but it does not forgive VAT that was actually invoiced and collected, irrespective of the taxpayer’s registration status. Any application for cancellation or refund therefore requires a prior review of the invoices issued during the relevant period, a task that falls, in the first instance, to the taxpayer.
How Does the Amnesty Mechanism Work, Step by Step?
The law treats amounts not yet collected by the state differently from amounts already paid. For unpaid obligations, cancellation operates ex officio, through a decision of the competent tax authority communicated to the taxpayer (Article 1(10)). The taxpayer therefore receives a cancellation decision, not a tax assessment decision.
Tax assessment decisions that were issued but not communicated before the law entered into force will no longer be communicated by the tax authority, and the corresponding obligations are removed directly from the tax authority’s analytical records, on the basis of a write-off schedule (Article 1(11)). In this case, cancellation does not take the form of a communicated decision; the tax obligations simply disappear from the tax authority’s records.
For amounts already paid, a refund is not made automatically, but only upon the taxpayer’s request, and only for amounts paid in respect of obligations established through a tax assessment decision, for certain periods:
- for ordinary taxpayers, amounts relating to the period between 1 January 2019 and the date the law entered into force (Article 1(4));
- for agricultural cooperatives, amounts relating to the period between 9 January 2024 and the date the law entered into force (Article 1(5)).
In either case, the condition is that the amount must have actually been extinguished, and in this regard the law refers to Article 22 of the Tax Procedure Code (Law No. 207/2015), which lists the means of extinguishing a tax obligation: payment, enforcement, or set-off.
Accordingly, the means by which the amounts reached the state budget is immaterial; what matters is only that the amounts were actually collected by the state in respect of an obligation now falling within the scope of Law No. 177/2026.
Of particular practical relevance is the limitation period for the right to claim a refund of the amounts referred to in Article 1(4) and (5), which does not run from the date of payment, but from the date the law entered into force (Article 1(6)).
In practical terms, the law effectively reinstates the time limit for taxpayers who made payments between 2019 and 2021 and who, under the general five-year limitation period applicable to tax claims, would otherwise have risked having their right to a refund already time-barred.
What Should an Affected Taxpayer Actually Do?
- identify the periods during which it operated with a cancelled VAT code between 1 January 2019 and 27 August 2026, and the related tax assessment decisions;
- for each decision, verify whether it was issued and communicated within this period, and whether the cancellation of the code was based on letters (a), (d) or (e) of Article 316(11) of the Fiscal Code, as confirmed by the tax certificate or correspondence with the tax authority;
- check whether it separately stated VAT on invoices or actually collected it from customers, a situation that excludes the application of the law;
- for unpaid amounts, await the ex officio cancellation decision and verify whether it fully covers the amounts recorded in the taxpayer’s tax ledger;
- for amounts already paid, promptly file a reasoned refund request, accompanied by proof of payment, the tax assessment decision, and a separate claim for interest;
- check for any outstanding obligations that could be set off against the amount to be refunded, in order to correctly estimate the net amount recoverable;
- avoid entering into payment rescheduling arrangements for amounts that could fall within the scope of the law, until the procedure is clarified;
- monitor the publication of the ANAF order, the deadline set by the law being 23 September 2026.
Law No. 177/2026 is not merely a tax amnesty; it is a correction of a mechanism that, year after year, turned an administrative formality (the cancellation of the VAT code) into a source of claims often disproportionate to the taxpayer’s conduct.
The window for action is, however, limited. Reviewing the tax assessment decisions, identifying the recoverable amounts, and filing refund requests cannot be delayed, all the more so since, for amounts already paid, the limitation period for the right to claim a refund does not run from the date of payment, but from the date the law entered into force (27 August 2026). The publication of the ANAF order, still under public debate, should clarify the actual procedure.
This article has been prepared, for the Blog of Costaș, Negru & Asociații, by Mrs. Lia Pricope.
Costaș, Negru & Asociații is a law firm with offices in Cluj-Napoca, Bucharest, and Arad, providing legal assistance, representation, and consultancy across various practice areas through a team of 16 lawyers and consultants. Details regarding the legal services offered and the team composition can be found on the website https://www.costas-negru.ro. All rights to materials published on the firm’s website and via social media belong to Costaș, Negru & Asociații; reproduction of these materials is permitted solely for informational purposes and subject to correct and complete citation of the source.
